1. Field of the Invention
Embodiments of the invention generally relate to a method and system for supervising electronic text communications in an enterprise. More particularly, exemplary embodiments of the invention invoke communication screens, based on organizational information, between an employee and other employees or non-employees; analyze the electronic text messages and contextual information, based on rules corresponding to the invoked communication screens, to provide a supervisory score; and apply supervisory action to the electronic text message based on the supervisory score.
2. Description of the Related Art
Many enterprises are faced with the problem of supervising electronic text communications, such as email, instant messages, and electronic text transcripts of Voice over Internet Protocol (VoIP), to detect potential leaks of inside information, proprietary information, confidential information, or other inappropriate communications. For example, Rule 3010(a) of the National Association of Securities Dealers (NASD) requires its members to establish and maintain a system to supervise the activities of each registered representative, registered principal, and other associated person that is reasonably designed to achieve compliance with applicable securities laws, regulations, and NASD rules. Rule 3010(b)(1) requires NASD members to establish, maintain, and enforce written procedures to supervise the activities of registered representatives, registered principals, and other associated persons that are reasonably designed to achieve compliance with applicable securities laws, regulations, and NASD rules. Rule 3010(c)(1) requires NASD members to conduct a review, at least annually, of the businesses in which they engage to assist in detecting and preventing violations of, and achieving compliance with, applicable securities laws, regulations, and NASD rules. Rule 3010(d)(2) requires NASD members to develop written procedures for the review of incoming and outgoing written and electronic correspondence with the public relating to their investment banking or securities business. For another example, New York Stock Exchange Rule 342 also requires its members to implement supervisory policies and procedures. For another example, Section 15(f) of the Securities Exchange Act of 1934 requires registered brokers and dealers to establish, maintain, and enforce policies and procedures reasonably designed to prevent the misuse in violation of the Act, or the rules or regulations thereunder, of material nonpublic information by such broker or dealer or any person associated with such broker or dealer.
An example in which supervision of text messages may be required involves the equity research department of an investment bank, which periodically releases analysts' reports and recommendations (e.g., buy, sell, or hold) to investors. The investment bank would like to enforce policies and procedures to prevent unauthorized persons, such as persons outside of the bank, persons not within the equity research department, or unauthorized individuals within the equity research department of the bank, from receiving material nonpublic information regarding such reports or recommendations before they are released to investors. For example, the bank would like to prevent the release of such information to its own brokers, who might engage in prohibited trades based on the information before the reports or recommendations are issued.
Another example in which supervision of text messages may be required involves disclosure of information about a sensitive project in an enterprise. For example, suppose that a limited group of employees in an investment bank is working on a project involving a potential merger or acquisition. The bank would like to limit disclosure of material nonpublic information about the possible merger or acquisition to the project group and certain other authorized individuals within the enterprise, for example, a compliance officer or senior executive.
In another example in which supervision of text messages may be required, an individual employee may have a potential conflict-of-interest due to confidential information obtained during his or her previous employment that precludes the employee from being involved with certain transactions. For example, an employee of Firm B, who had formerly worked for Firm A, may be precluded from working on transactions involving commercial customers of Firm A for a period of time. Therefore, Firm B would like to screen the employee from sending or receiving any communications about a transaction involving a Firm A customer.
In yet another example in which supervision of text messages may be required, many financial services firms maintain “watch lists” and “restricted lists” that identify companies about which the firm has material nonpublic information. These financial services firms use watch lists to monitor suspicious trades and detect potential insider trading violations, while they use restricted lists to restrict or prohibit employee trading, proprietary trading, or trade solicitations in securities of the listed companies. Generally, disclosure of watch lists is limited to the firm's compliance and/or legal departments and other specifically authorized individuals, while restricted lists are disseminated more widely to firm employees. The financial services firms would also like to detect and prevent improper communications of material nonpublic information concerning the listed companies.
Conventional monitoring of an employee's electronic text messages may entail automatically storing all or random samples of email identified by sender and recipient, in which the recipient may be another employee or someone outside the enterprise. Some monitoring systems identify and store only email containing selected keywords or pre-defined text patterns, determined by rules, for subsequent review by a manager or compliance officer. Different rules, in these systems, may apply to different employees. Other employee communication monitoring systems may monitor both email and instant messaging.
There remains a need to automatically and more effectively address the problems of detecting and preventing inappropriate and/or illegal disclosures of information via electronic text messages in an enterprise.